The FBI is probing Long Island Iced Tea’s infamous pivot to blockchain in 2017, searching for evidence of insider trading and securities fraud.
The beverage company made an unexpected shift to blockchain during 2017 bitcoin bull run and witnessed a staggering 300% surge in stock price. The FBI now suspects that the company’s move to blockchain and corresponding price spike were parts of a scheme to manipulate the market and allow the conspirators to profit.
According to Quartz, the FBI is also looking for evidence related to a potential “pump-and-dump” scheme involving Long Island Iced Tea stock. If the allegation is true, the promoters of the stock would have bought it cheap at around $2 ahead of the company’s announcement that it was shifting to blockchain, and sold it after the price climbed.